Reed Smith Client Alerts

Authors: Julie A. Hardin

Leah Rudnicki, Julie Hardin, and Ben West are litigators in Reed Smith’s Houston office where they represent oil and gas companies in a wide variety of issues, including the transportation of hazardous materials by rail. Jeffrey Orenstein is in the Washington, D.C. office where he provides clients with strategic counsel on the export, sale, and transportation of crude oil and petroleum products.

As part of a 19-month initiative to improve the safety of hazardous rail traffic, on Friday, May 8, 2015, the U.S. Department of Transportation (“DOT”) published1 new regulations and standards for the bulk transport of Class 3 flammable liquids—including crude oil and ethanol2—via the nation’s railroads, amending the existing Hazardous Materials Regulations (“HMR”). See 49 CFR parts 171-180.

The amended regulations, which go into effect on July 7, 2015, are explained in the DOT’s extensive summary of the “Final Rule,” titled “Hazardous Materials: Enhanced Tank Car Standards and Operational Controls for High-Hazard Flammable Trains.” The Final Rule was jointly developed by DOT’s Pipeline and Hazardous Materials Safety Administration (“PHMSA”) and the Federal Railroad Administration (“FRA”)—and in coordination with Transport Canada.3 According to DOT, the amended regulations are “designed to prevent accidents, mitigate consequences in the event of an accident, and support emergency response.”

This client alert is intended to give those impacted by the Hazardous Materials Regulations a high-level overview of the new requirements and the contents of the Final Rule. Specifically, to review answers to the following questions:

  1. Does the Final Rule Impact the Oil Industry?
  2. What Should You Know about the Final Rule?
  3. Is the DOT’s Final Rule Harmonized with Transport Canada’s Rules?

Please also look for your invitation to Reed Smith’s upcoming May 27, 2015 webinar discussing these issues in more detail. Register for the webinar now.

To read the full alert, download the .PDF below.

  1. The DOT first issued the Final Rule on May 1, 2015 and officially published the Final Rule in the Federal Register on May 8, 2015.
  2. According to DOT, “this rule primarily impacts trains transporting large quantities of ethanol and crude oil, because ethanol and crude oil are most frequently transported in high-volume shipments…” See Executive Summary of Final Rule.
  3. Transport Canada is the Canadian federal department responsible for the majority of the Government of Canada’s transportation policies and programs.